When the planned $300 million merger between Third Wave Technologies and PE Biosystems collapsed earlier this year, one little-noticed side effect involved an $8 million payment that Third Wave had made to buy back rights to its technology.
In 1997 Third Wave and cytokine specialist Endogen signed a five-year deal giving Endogen certain exclusive development rights to Third Wave’s Invader genotyping technology. But PE Biosystems would have none of that. As a condition of the merger PE ordered Third Wave to buy back the two-and-a-half years’ worth of rights, which Third Wave promptly did for $2 million in cash and a $6 million promissory note.
When the merger blew up, not only was Third Wave out the $8 million, but also there was no longer an Endogen deal.
At least not for Third Wave: In mid-1999 Sweden’s Perbio Sciences acquired Endogen for $13.5 million. But Third Wave’s $8 million payment effectively reduced the net purchase price to $5.5 million. Perbio president Mats Fischier pronounces the transaction “favorable.” Guess so.